Ron Paul's Last Stand - Audit the Fed

Congressman Ron Paul has been after the Federal Reserve for decades. His last great act before retirement, to audit the Fed, just passed the House of Representatives. All but one Republican voted for the bill with Democrats split down the middle. Our more corporate Democrats voted against the bill. Now the Senate has vowed to not take up the bill.

A senior Democratic Senate leadership aide said there are no plans to bring the bill up in the Senate, but didn’t rule out an attempt by Republicans to seek a vote on the measure as part of another piece of legislation. The Senate would be almost certain to defeat it given the Democratic majority in the chamber.

"This bill would instead jeopardize the Fed's independence by subjecting its decisions on interest rates and monetary policy to GAO audit," said House Minority Whip Steny Hoyer (D-Md.). "I agree with [Fed] Chairman [Ben] Bernanke that congressional review of the Fed's monetary policy decisions would be a 'nightmare scenario,' especially judging by the track record of this Congress when it comes to governing effectively.

Matt Stoller, former Congressional staffer, spills the beans on the behind the scenes politics.

This is a whipped vote, which means that this is one of those times where the Democratic leadership – Steny Hoyer, Barney Frank and Nancy Pelosi – are putting their stamp on an issue. They have come out firmly for Fed secrecy.

Stoller calls the Fed:

It is a quasi-fiscal agent conducting its own foreign policy, with swap lines open to foreign central banks without permission from Congress and a regulatory apparatus that is designed to protect the capital structure of the big banks.

Literally the movement to audit the Fed has their own website. Ron Paul's office has put up their questioning of Ben Bernanke from his testimony last week.

Below is a Faux News Clip which interviews Ron Paul and his last stand.

Matt Stoller points to the Federal Reserve literally lobbying to stop this bill from passing:

If I had to guess, what’s happening here is that the Fed is conducing an aggressive lobbying campaign among Democratic leaders. I described the Fed’s legislative activity in this piece, How the Federal Reserve Fights. The central bank is a powerful agent on the Hill, and the people that run the Fed and the big banks and economics establishment who rely on the Fed want to keep it that way. In 2009, the Fed hired Linda Robertson to lobby Congress. Robertson was the former head of Enron’s lobbying operation and a well-known Democratic establishment player. She is well-suited to run such a lobbying effort against Ron Paul’s bill. She did it in 2009 and 2010. I checked her campaign contributions, and she maxed out to both Hillary Clinton and Barack Obama in 2008, while also being quite savvy about distributing money to both parties when necessary (here’s her work at Enron engaging in what looks somewhat close to bribery). Being a key lobbyist for Enron might disqualify you for a job requiring integrity, but it is apparently a mark of prestige in DC to have that on your resume.

The Senate version is S. 202: The Federal Reserve Transparency Act of 2011, and sponsored by Ron Paul's son, Senator Rand Paul (R-KY). It has no Democratic or Independent co-sponsors. Stoller believes if all else fails, the bill would be vetoed by Obama.

Do we want Congress doing more damage, able to influence actual monetary policy? Hell No. Do we want select big banks doing the same thing through the Federal Reserve? Hell No again. That's the problem, the dilemma, we simply do not have government acting in the national interest, the people's interest and most of all, sane, wise economic policy is just not on the table. Our government is run like a cartel, a corporate, multinational select group of players along with a few super rich campaign donors. We simply do not have real representation in the Federal government these days. No matter what happens with the audit the Fed bill, that fact won't change.

What I'm pointing out is our government, Congress is even worse than the Federal Reserve in terms of favoring TBTF banks, the uber-rich, special interests. That's the problem here. Of course I want the Fed audit to pass, from what we learned about the bail outs, after Bloomberg (great job Bloomberg) went after their FOIA plus the GAO reports, are you kidding me? Of course the Fed needs to be audited, transparent.

Our problem here is Congressional oversight, involvement means even worse damage to the U.S., U.S. middle class, workers and the economy.

It's a frying pan to fire thing. Honestly, just one good idea, could be written up as a bill with two paragraphs, do you think Congress could pass it, even when 98% of all economists agree and 99% of America wants it? Of course not. Case in point tax credits to hire U.S. citizens, tax credits to train U.S. citizens on the job. I'm fairly certain this idea is endorsed widely, yet Congress refuses to pass something that obvious with unofficially almost 28 million people out there needing a good job.

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